Judgment :-

S.H. KAPADIA, J.

1.1. Delay condoned.

2.2. Leave granted.

FACTS IN THE LEAD MATTER

Civil Appeal Nos. of 2009 - Arising out of S.L.P.(C) Nos.14178-14182 of 2007 -M/s. Rotork Controls India (P) Ltd. v. Commissioner of Income Tax, Chennai.

1.3. In these civil appeals filed by the assessee we are concerned with the assessment years 1991-92, 1992-93, 1993-94 and 1994-95. For the sake of convenience we hereby refer to the facts concerning assessment year 1991-92.

2.4. Appellant-company sells Valve Actuators. Bulk of the sales is to BHEL. At the time of sale appellant (assessee) provides a Standard Warranty whereby in the event of any Beacon Rotork Actuator or part thereof becoming defective within 12 months from the date of commissioning or 18 months from the date of dispatch whichever is earlier, the company undertakes to rectify or replace the defective part free of charge. This warranty is given under certain conditions stipulated in the warranty clause. For the

assessment year 1991-92, the assessee made a provision for warranty at Rs.10,18,800/- at the rate of 1.5% of the turnover. This provision was made by the assessee on account of warranty claims likely to arise on the